I admit i made a mistake accepting paypal. I was after a quick sale and it unfortunately went sour. What i wont accept is paying back £490 for a phone that i no longer even have for a clearly fraudulent transaction. By taking the side of a buyer claiming that their account was fraudulently logged in they are in essence saying i was involved in that fraudulent log in. Besides writing to paypal escalations and reporting to Action Fraud, what else can i do. I am happy to defend myself in court

Hie All Last month I sold a Galaxy S7 Edge for £500 on ebay. I insisted on collect in person but foolishly agreed to be paid cash upon collection. I met the buyer in the high street I was given the money and I gave them the phone. I immediately withdrew the money from my paypal to my bank account. 2 days later I received an email from paypal that the buyer is disputing the transaction on the grounds of fraudulent log in of their paypal account. Needless to say paypal took the side of the buyer and refunded the buyer the money whilst debiting my paypal account leaving it in negative to the tune of £490. Paypal has now passed on the debt to Akinika who sent me a text message yesterday asking me to make contact regarding the matter. The question is how do I proceed from here?. Do I contact the financial ombudsman?. Do I even make contact with Akinika? Later on today I will reporting the matter to Action Fraud. Could someone kindly point me out to some template letters I can use to contact paypal escalations about the matter because I feel hard done by as I have lost both the phone and now paypal wants me to fork out £490 which I simply don't have. Ok, I made a mistake accepting paypal payment for collect in person transaction but paypal should simply ban this type of payment for collect in person transactions as they give fraudsters an opportunity to [problem]. The thing I simply don't even have £490 to restore the paypal balance and I am prepared to go to court to explain to a judge the circumstances of the debt. I would appreciate help of what steps I can take to hopefully get paypal to write off the amount as a gesture of goodwill.